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COVID-19 Tax Matters for Private Fund Managers

Certain tax deadlines in the following salient jurisdictions may or may not be further extended due to disruption caused by COVID-19 as of the time of this publication:

CALIFORNIA

The deadline for tax filing and payment is extended until July 15 for all individuals and business entities for the following: 2019 tax returns; 2019 tax return payments; 2020 1st and 2nd quarter estimate payments; 2020 LLC taxes and fees; and 2020 non-wage withholding payments.

Payroll Tax: Employers may request up to a 60-day extension to file their state payroll reports and/or deposit payroll taxes without penalty or interest by following the instructions of the Employee Development Department (EDD).

San Francisco

Businesses with less than $10 million in gross receipts may defer their first quarter business taxes (which under normal circumstances must be pre-paid by April 30th) until February 2021. The deferral is applicable to gross receipts tax, payroll expense tax, commercial rents tax and homelessness gross receipts tax.

No interest payments, fees or fines will accrue as a result of the deferral. Further details are available in the announcement from the Office of the Mayor.

Illinois has yet to announce an extension of
deadlines for tax filings and payments as of the date of this publication.

NEW YORK

On March 16, 2020, the New York State Tax
Department announced that it had not extended the deadline to file personal
income tax or other tax returns. New
York has yet to announce an extension of deadlines for tax filings and payments
as of the date of this publication.

New York has waived fines for businesses that
have missed the sales tax deadline of March 20, 2020. There is no waiver of accrued interest.

New York City

The city is in the process of establishing the Small Business Continuity Fund which intends to provide financing to businesses demonstrating at least a 25% decrease in revenue caused by COVID-19.

For general questions or concerns related to impacts of coronavirus on the operations or compliance of funds and advisers, please contact us.

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Bart Mallon is a founding partner of Cole-Frieman & Mallon LLP. Cole-Frieman & Mallon is a boutique law firm focused on providing institutional quality legal services to the investment management industry. For more information on this topic, please contact Mr. Mallon directly at 415-868-5345.